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South African Competition Commission response to COVID-19

30.03.2020
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On the 15th of March President Cyril Ramaphosa declared a State of National Disaster, as well as enforcing of a nationwide lockdown for 21 days starting from the 26th of March 2020. South African competition commission recently released a statement explaining the measures it will take during the COVID-19 lockdown.

According to this statement, the Competition Commission will scale down the focus on most of the operations and will at the moment prioritise the investigations related to the COVID-19. Furthermore, the Commission has officially issued a statement discouraging the filing of complaints that are not associated with the COVID-19 pandemic, as well as all merger transactions except those involving failing firms or those firms in distress. In the same statement the Competition Commission has also confirmed that they already have 20 cases related to the spikes in prices of essential products pertaining to the COVID-19 outbreak. In the press release on its website the South African Competition Commission commented on the situation with the following statement: -"Minister Patel yesterday gazetted regulations in terms of the Competition Act and Disaster Management Act which aim to strengthen the ability of the Commission and the National Consumer Commission to respond to incidences of exploitative pricing. These regulations empower the Commission to prosecute cases where prices have increased materially without any cost justifications for the increase. The Commission is working closely and coordinating with the National Consumer Commission to provide consumers the swiftest and most effective protection against price abuse during this period. The Minister of Trade, Industry and Competition, the Commissioners of the Competition Commission and the National Consumer Commission have been in contact with the major retailers and pharmacy CEOs to address, among other issues, concerns around price increases. All the retailers are supportive of government and regulators' efforts to protect consumers at this critical time."

Furthermore, the South African Competition Commission has also decided to relax a competition law in the healthcare sector during the COVID-19 outbreak to facilitate more effective medical response. The Competition Commission has explained the measure by stating that: - "This will assist in ensuring that the private and public healthcare system can provide the necessary care to citizens without fear of falling foul of the Competition Act."

As part of the aforementioned measures, the government has relaxed the scrutiny on the hospitals, medical suppliers, laboratories and pathologists, pharmacies, and healthcare funders.

However, the press release stressed that such measures must not negatively affect the healthcare system or the patients: - "these regulations are limited to ensuring an adequate supply of healthcare to citizens and competition regulation for a growing and inclusive economy and do not give the private healthcare industry the right to cooperate on pricing to the public."